Co-branding is a form of brand extension whereby a marketing partnership is made between two or more different companies. Co-branding can be extremely beneficial for businesses…if done right.

Co-Branding: The Basics

There are various types of co-branding including ingredient co-branding and composite co-branding. Ingredient co-branding creates value through partnering with companies whose products are used in your products. For example, Intel is the ingredient brand to Dell, a computer technology company that uses Intel’s Core processors.

Composite co-branding, on the other hand, involves a partnership between two or more companies to invent and produce a new product or service for their target audiences. British Airways and Citibank partnered up to release a credit card that automatically registers members to the British Airways Executive Club.

How Can Co-Branding Benefit Brands?

Improves credibility

If one company is seen to be working with a popular, more well-known business, the audience are likely to trust them more due to the credibility of that brand. Increased brand trust will help grow sales in the long-term as the audience will look to the company for that particular product or service category. Media monitoring tools can measure the sentiment of the buzz on social media and in news, giving insight into whether people trust the brand or not. We can dig deep into what people are saying about the brand. If there is negative sentiment surrounding a particular brand, it would be a good idea to avoid them, as that negative buzz or press could get reflected onto the company if it is decided to form a partnership.

Cash injection

A top benefit of co-branding is that there is more money available for marketing purposes. If both companies spend their usual marketing budget each on a joint campaign, then the campaign is likely to be much bigger and better than an independent campaign. Two companies = larger cash injection! However this is dependent on the agreement between the two businesses.

Boosts visibility

Co-branding also increases reach. The two partnered companies advertise one product or service to both of their audiences, therefore increasing the number of people that the message is communicated to.

Things to Consider before Partnering Up

Size matters!

Large companies are better able to compete with small businesses as they can transfer their successful and popular brand names to their new products. However small businesses that haven’t fully established themselves in the market aren’t able to do this. Therefore it’s important for small businesses to partner with other small business, or focus on areas with little competition. We can use media monitoring tools for social listening to find which brand names of a particular product category are popular and have positive buzz. If they’re being mentioned frequently and positively on social media and in the news, it gives us a good indication as to whether they’re recognised in the market and might be worth co-branding with.


Partner with the company that is right for you

A customer will be put off buying if they are unaware of the company you’re partnered with. In order to create a product that will lift off, it is important to make sure that the two companies complement each other in terms of recognition, brand image, and values. Media monitoring tools such as Meltwater can be used to determine aspects such as the partner’s key messages, their brand perception, and if they are known in the geographic market where we want to set up shop. We can use this information to assess whether or not a partnership with that company would be advantageous.

That’s it for co-branding. For more information on how you can use media monitoring tools for research and development, read our blog.